ERISA-Fifth Circuit Rules That Plan Failed To Comply With ERISA Procedures By Changing Its Basis For Denying Benefits At The Administrative Appeal

January 16, 2013

ERISA

Share/Bookmark

In Rossi v. Precision Drilling Oilfield Services Corporation Employee Benefits Plan, No. 11-50861 (5th Cir. 2013), the plaintiff, Lucas Rossi (“Rossi”), was appealing the district court’s grant of summary judgment to the defendant, Precision Drilling Oilfield Services Corporation Employee Benefits Plan (the “Plan”), on Rossi’s claim for benefits under ERISA.

In this case, Rossi had suffered a hemorrhagic stroke, due to the rupture of an arteriovenous malformation when he was sixteen. He will likely need care for the remainder of his life. As the son of an employee of Precision Drilling Oilfield Services Corporation , he is a beneficiary of the Plan, which provides medical benefits. Rossi filed a claim with the Plan to cover his therapy and rehabilitation treatment. The Plan denied the claim, including in an administrative appeal. This suit followed.

In analyzing the case, the Fifth Circuit Court of Appeals (the “Court”) said that Rossi asserted that, in denying his claim, the Plan did not comply with procedures set out by ERISA ( in 29 U.S.C. § 1133). This obtained because the Plan changed its basis for denial on administrative appeal. Initially, the Plan denied Rossi’s claim on the grounds that Rossi was not receiving sufficient medical care to be incurring medical expenses. Then, on the appeal, the Plan relied on an exclusion for inpatient care at a facility to deny the claim. As such, the Court concluded that the Plan had violated ERISA by changing its basis for denying Rossi’s claim. As such, the Court reversed the district court’s grant of summary judgment and remanded the case back to the district court, for the entry of an
order sending the case back to the Plan for a full and fair review.
.

Comments are closed.